My friend, the cryptocurrency market has many opportunities but at the same time is full of crazy fluctuations, meaning you could win today and lose tomorrow. That's why you need a weapon to protect your portfolio, and this weapon
It is risk management
Let me tell you the most important points you should pay attention to
1️⃣ Trade size – don't put all your money into one trade
📊💡
Don't risk more than 1 to 2% of your capital on any trade you enter
So if you have 10,000 Riyals, don't put more than 100 to 200 Riyals in a single trade
Why? Because if you lose several trades in a row, you can bear it and continue
But if you enter with a large amount from the beginning and lose, you could burn half your portfolio in an instant
2️⃣ Stop-loss – the lifeboat during storms
🛑📉
Before entering any trade, determine an exit point if the market reverses
Don't set stop-loss randomly; base it on technical analysis like support or resistance. The stop-loss saves you from emotional decisions during a downturn.
3️⃣ Portfolio diversification – don't put all your eggs in one basket
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Diversify your money among large currencies like $BTC and $ETH and also a few alternative currencies and promising projects; diversification protects you if one currency lets you down
4️⃣ Be against FOMO – don't chase the hype
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FOMO (fear of missing out) is the biggest trap; be rational and set clear conditions before entering any currency, like breaking resistance or bouncing from strong support.
5️⃣ Leverage – a double-edged sword
⚔️📈📉
Leverage multiplies profit and loss
If you're a beginner, stick to a simple leverage like 2x or 5x
Even if the market plays with you, staying without leverage is more comfortable for you
6️⃣ Liquidity and trading volume – don't get involved in a dormant currency
💧📊
Look for currencies with high trading volume and respectable liquidity
So you can enter and exit easily without the price slipping on you
7️⃣ Control your emotions – greed and fear are the worst enemies
😤😨
Have a clear plan and stick to it
Don't change your mind every now and then because of the market
Document your trades and see where you went wrong and learn from your mistakes
8️⃣ Review your performance – repetition teaches diligence
📓🔍
Record every trade you enter
How much did you enter and how much did you exit, and why did you enter in the first place
And do a review for yourself every week or month
This thing helps you develop your strategy and reduce repetition of mistakes
In summary?
📌
Risk management is not just theoretical talk
It's the only way to protect your money and keep you in this long game
Always think about survival before profit and make financial safety your top priority
